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 Collateral account[/en/tasks/payment-systems/collateral-account]

Collateral account

The Deutsche Bundesbank maintains the collateral accounts required for posting monetary
policy collateral for its monetary policy counterparties. It is therefore involved in the
implementation of the Eurosystem’s operational monetary policy at a central point.
Operational monetary policy includes, amongst other things, open market transactions to
absorb and supply liquidity, which the Deutsche Bundesbank carries out within the scope
of its responsibility for its counterparties established or resident in Germany.

Customer information
As part of its collateral management, the Deutsche Bundesbank provides its monetary policy counterparties with
the (collateral) accounts and (operational) safe custody accounts required for posting monetary policy collateral
(marketable and non-marketable assets). In a collateral account, valued collateral stocks are compared against total
utilisation. Free collateral value may be transmitted to the TARGET-Bundesbank primary Main Cash Account (MCA)
as a variable or, if desired, fixed credit line.

The Deutsche Bundesbank uses a pooling system to collateralise Eurosystem credit operations. The advantage of
this system is that the collateral values of all submitted collateral are combined in a single collateral account rather
than individual eligible assets being allocated to specific monetary policy operations. Credit utilisation must be
adequately covered by eligible collateral at all times.

The diagram illustrates the structure of a monetary policy collateral account.

Further Information

 Open market operations

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 Mobilisation of collateral
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